ISS backs Anglo American merger with Teck Resources - Bloomberg

Institutional Shareholder Services Inc. recommended investors vote in favor of Anglo American Plc's combination with Teck Resources Ltd., becoming the second shareholder advisory firm to support the mining deal, Bloomberg reports.

The transaction would create a $50 billion producer of copper, zinc and other metals across multiple continents, ranking among the largest deals in mining industry history. Investors from both companies are scheduled to vote on the combination at special meetings in London and Vancouver on Dec. 9.

"Support is considered warranted for the merger, due to the anticipated synergies, strategic benefits, and positive market reaction," ISS stated in a report issued Wednesday. Glass, Lewis & Co. recommended investors approve the deal five days earlier.

ISS opposed proposed changes to Anglo American's long-term incentive plan tied to the transaction's success, stating that "transaction-related remuneration is not considered good market practice in the UK."

The deal requires regulatory approval in China, the United States and Canada. Canada is reportedly pressuring Anglo American to make stronger commitments to executive and management positions at its proposed Vancouver headquarters as a condition for acquiring Teck Resources.

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